[nvegater]

I see this as oversimplification. US Tech faces hard regulations too (fintech, healthcare etc...). Also Regulation is not that big of a bump in EU. GDPR simplified rules across 27 different national laws and forced new innovations in privacy. Also Spotify, SAP, Adyen all started in small markets, as counterexamples. The main reasons why USA is ahead I think are the historical advantages (internet, personal computer), the network effects created by the historical advantages and the VC ecosystem. Also the culture for risk tolerance.

[vineyardmike]

Regulation may or may not be that much worse in the EU, but if there are 27 different countries, it adds a lot of uncertainty and legal work as you roll out to each one. GDPR wasn't written until tech winners were already called.

The VC system and network grew out of this existing development in America (of course the capital markets have been there since before tech, as I mentioned). The banking and finance system grew in America for the same reason - a large single-regulator market.

Spotify is basically a US company today - They have huge US offices, and their US subscribers are crucial. It's also a perfect example of a business that doesn't follow the high-fixed-cost-low-ongoing-cost model. They have to pay a license fee for every stream, so they can't amortize their costs across users nearly as well.

SAP is another example of a business that doesn't amortize as well across users - their product is very bespoke per company, and negotiated individually.